FRANKFURT — Deutsche Lufthansa AG has warned that full-year profit will fall short of original targets, citing a €1.7 billion increase in jet fuel costs driven by energy market volatility linked to the Iran conflict.
The fuel cost surge represents a direct hit to margins even as the airline reported record revenue for 2025. Strong top-line growth has not been enough to absorb the external price shock, exposing how sharply geopolitical risk can compress airline profitability when hedging assumptions break down.
Chief Financial Officer Till Streichert said the current environment forces the company to "examine every lever available to reduce costs, improve efficiency, and mitigate risks." He said annual profit will "likely be lower than originally anticipated."
Shortened booking cycles compound the pressure. Compressed lead times reduce visibility into forward demand, making capacity planning and yield management harder to optimize across Lufthansa's route network.
Despite the revised outlook, Streichert said he remains confident the full-year result will come in "significantly above prior-year levels" — provided fuel supply bottlenecks do not materialize and further labor strikes do not occur.
Management has launched a comprehensive operational review targeting cost reductions and efficiency gains across all business segments. The €1.7 billion fuel cost increase sets the floor for how much those savings need to recover.
